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Speaker 1: Bloomberg Audio Studios, Podcasts, radio news from.

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Speaker 2: Mark Hard We're Innovation, Money and Power Collie in Silicon.

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Speaker 3: Valley, NBN.

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Speaker 4: This is Bloomberg Technology with Caroline Hyde and.

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Speaker 5: Ed Love Love.

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Speaker 6: Live from New York and San Francisco. This is Bloomberg

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Speaker 6: Technology Broadcom. It's falling hard after a disappointing forecast despite

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Speaker 6: robust demands for AI products.

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Speaker 5: Tech stocks flirting with their worst week since twenty twenty

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Speaker 5: two ahead of Apple's big launch event, and the.

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Speaker 6: White House is targeting China again, planning a fresh round

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Speaker 6: of chip related export controls. We discussed, but first we

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Speaker 6: have some macro breaking news from the Federal Reserve and

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Speaker 6: the Mann To bring us the details is one McKee Bluemost,

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Speaker 6: Chief International Economic Suppose, the correspondent coming from FED speak.

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Speaker 7: Well, this is what everybody's been waiting for all day.

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Speaker 7: The job's number comes in at one forty two and

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Speaker 7: unemployment falls back to four point two. What will the

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Speaker 7: Fed do fifty or twenty five? We get a hint

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Speaker 7: from Chris Waller, the Federal Reserve governor, often seen as

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Speaker 7: the leading guide to FED activity, and he says today's

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Speaker 7: data show it's time to cut rates. Determining the pace

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Speaker 7: of rate cuts and ultimately the total reduction in the

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Speaker 7: policy rate are decisions that lie in the future. As

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Speaker 7: of today, I believe it is important to start the

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Speaker 7: rate cutting process at our next meeting. If subsequent data

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Speaker 7: show a significant deterioration in the labor market, the FOMC

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Speaker 7: can act quickly and forcefully to adjust monetary policy. Now,

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Speaker 7: while Waller says we are not in recession and it

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Speaker 7: doesn't necessarily look like we are going into recession, the

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Speaker 7: economy looks pretty strong. He says the risks are now

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Speaker 7: tilted towards the downside on growth, Inflation has gotten better.

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Speaker 7: He doesn't say whether it'll be fifty or twenty five,

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Speaker 7: but says that's a decision that's coming up team.

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Speaker 5: Once we get through the yield, show me the Nasdaq

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Speaker 5: one hundred, or show me the S and P five hundred,

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Speaker 5: and let's show our audience that the market's kind of

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Speaker 5: changed direction on those headlines. Mike, I want to read

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Speaker 5: one specific bit back to you, which is the current

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Speaker 5: batch of data no longer requires patients. It requires action,

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Speaker 5: but there's no size and scope to what action means.

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Speaker 5: We don't have a basis points number do we.

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Speaker 8: We don't, And that's a little bit odd.

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Speaker 7: And in the sense that Chris Waller goes on to

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Speaker 7: say that he was an advocate of front loading rate

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Speaker 7: increases when inflation went up, and if the data supported

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Speaker 7: he would be an advocate of front loading rate cuts.

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Speaker 8: What data is he talking about.

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Speaker 7: We really don't get much more before the next FED meeting,

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Speaker 7: So I'm not sure why he wasn't more specific, other

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Speaker 7: than perhaps he doesn't want the markets to get ahead

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Speaker 7: of themselves in pricing.

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Speaker 6: That's what markets do. They get ahead before dugging. Michael McKee,

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Speaker 6: just brilliant to have you on this market moving story.

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Speaker 6: We appreciate it. Let's get analysis from the market. Shannon

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Speaker 6: Sicil is with us for more, CEO of Bannery and

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Speaker 6: Capital Management, which helps independent advisors with alternative investing options.

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Speaker 6: And currently you've got four billion dollars under advice. And

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Speaker 6: I'm really interested into ultimately how much macro the FED

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Speaker 6: is guiding investment choices right now, or how much you

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Speaker 6: can think about AI and productivity and technology still winning out.

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Speaker 9: So I think you've got to think of those things

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Speaker 9: in two separate ways. Right there is the current economic

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Speaker 9: environment in which the FED has been tightening, They've been

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Speaker 9: raising rates for a while, they've tried to get inflation

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Speaker 9: under control. The ramifications of that is that it softens

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Speaker 9: labor markets, it slows growth. The goal, of course, is

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Speaker 9: for it to slow growth, not growth go negative, and

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Speaker 9: we're seeing that kind of play out because it's more

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Speaker 9: expensive to borrow money in the capital markets are reacting accordingly.

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Speaker 9: You can think of that as the current environment and

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Speaker 9: still believe that technology trends like AI win longer term.

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Speaker 9: And it doesn't change the fact that companies, when they

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Speaker 9: look at where they're going to deploy capital and where

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Speaker 9: the opportunities lies, are going to do it in the

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Speaker 9: places they think they need to develop in order to

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Speaker 9: compete going forward. And so as they make those capital

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Speaker 9: deployment decisions, they are looking at things like AI, which

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Speaker 9: is the number one thing that they need to be

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Speaker 9: considering to continue to stay competitive. A great example is Apple, Right,

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Speaker 9: everybody was down on the stock prior to their announcements

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Speaker 9: of how they were going to be incorporating AI into

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Speaker 9: their iPhone platform and into their other devices. Right before that,

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Speaker 9: everybody was like, oh, there behind the eight.

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Speaker 8: Ball shown on the stock.

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Speaker 5: Hurt let me jump in there, and I'm sorry to

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Speaker 5: cut you off. I actually want to continue with some

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Speaker 5: of the real time reaction to those fed wallheadlines. One

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Speaker 5: of the alternatives that you track closely is bitcoin, right,

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Speaker 5: And when we got the jobs numbers, bitcoin jumped and

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Speaker 5: was in positive territory for much of the session. Going

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Speaker 5: into those fed wallheadlines at the top of the eleven

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Speaker 5: east an hour, it was markedly lower, about two and

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Speaker 5: a half percent.

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Speaker 8: It came off that a little bit.

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Speaker 5: Use that case study of one single session to explain

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Speaker 5: why you track bitcoin so closely for your clients.

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Speaker 9: So again we think bitcoin is using or even ease

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Speaker 9: it's crypto in general. Art right are taking advantage of

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Speaker 9: a technology of the future in blockchain.

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Speaker 10: You know, blockchain is.

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Speaker 9: A protocol, and we've seen the revolutions of protocols throughout

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Speaker 9: out the history of the Internet. You know, everything from

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Speaker 9: voiceover Internet protocol to HGTP is a protocol, like these

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Speaker 9: are all protocols.

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Speaker 6: Blockchain is a protocol.

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Speaker 9: Bitcoin works on that protocol, and that is a future

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Speaker 9: technology that we believe will be great.

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Speaker 11: You know, more largely adopted.

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Speaker 9: What we saw in the short term reaction to information

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Speaker 9: had more to do with a risk on risk off trade,

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Speaker 9: not necessarily the adoption of the protocol. So you can

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Speaker 9: believe two things at once. This is the difference between

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Speaker 9: a trader and a long term investor. Right, you can

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Speaker 9: believe that in the short term you're going to have

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Speaker 9: the market movements that you can profit from, and you

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Speaker 9: can also believe that, I don't care about what happens

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Speaker 9: on one individual day, but the longer term trend wins

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Speaker 9: out in the long term.

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Speaker 6: That's what happening when we're looking at the likes a

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Speaker 6: Broadcom today or in video last week, that it's the

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Speaker 6: trading that said them so much lower on actually pretty

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Speaker 6: fundamentally decent numbers in the long term, but they disappoint

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Speaker 6: because expectations have run so far so fast.

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Speaker 9: It's exactly right now. There's two different type of analysis

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Speaker 9: in finance, right, there's technical and there's fundamental. So the

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Speaker 9: fundamentals remain strong, but the technicals broke down, and the

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Speaker 9: technicals drive a lot of the algorithms that move the

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Speaker 9: markets these days, and so that's why you can see

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Speaker 9: these short term price dislocations that occur even though fundamental

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Speaker 9: information and the actual company itself is in good shape.

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Speaker 5: Seana, you stated the line that I've been using all week,

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Speaker 5: which effectively is one session a market does not make.

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Speaker 5: But I just want to stick with what's happening right now.

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Speaker 5: You know, we had that statement from Waller, you know,

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Speaker 5: tie it all together the post mortem of Nvidia, what

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Speaker 5: the expectation of what the FED will or won't do

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Speaker 5: this month is, and where you go from here.

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Speaker 10: So the post mortem of in Vidia is that in

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Speaker 10: Vidia is a great company doing great things, and that

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Speaker 10: has really attractive growth, just not the attractive growth that

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Speaker 10: they had before.

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Speaker 9: So when you were experienced in three four hundred percent

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Speaker 9: increases in revenue and you fall to one hundred and fifty,

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Speaker 9: that is a decline in your earnings momentum, but it's

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Speaker 9: still one hundred and fifty percent increase in your revenue.

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Speaker 9: And so overall, as a long term holder of in Video, personally,

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Speaker 9: I believe that the stock wins in the long term.

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Speaker 9: I follow the stock forever and the short term, what

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Speaker 9: you're seeing is that disappointment and the stock coming back

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Speaker 9: to reflect more closely, it's fundamentals when you start to

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Speaker 9: look at price to earnings and things of that nature.

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Speaker 9: So post mortem, I think long term and vida good

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Speaker 9: short term would probably have some volatility in terms of

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Speaker 9: the FED and what happens next. I think today's data

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Speaker 9: and the comments that came from Waller suggests that the

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Speaker 9: FED is still in line to make a rate cut

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Speaker 9: this month, and it will be the first of many.

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Speaker 9: And the question really becomes how big will that ratecut be?

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Speaker 9: And there was nothing that came out in today's data

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Speaker 9: that suggests that it should be anything more than twenty

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Speaker 9: five basis points in my opinion.

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Speaker 8: Shanna Sisters CEOBE, you messed up?

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Speaker 9: Did I miss another question you asked?

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Speaker 6: I think you have no?

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Speaker 5: I mean, my goodness, you took what I asked and

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Speaker 5: you really ran with it. We appreciate it. Shanna Sissl's

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Speaker 5: CEO of Bandary and Capital Management, Thank you very much.

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Speaker 5: Docu sign shares up in today's trading after the signature

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Speaker 5: company reported second quarter results, posting revenue of seven hundred

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Speaker 5: and thirty six million dollars billings growth of two percent.

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Speaker 5: But it's margins where a lot of the streets focuses.

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Speaker 5: Let's bring in doc you sign CEO Alan Tigerson, who

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Speaker 5: here in San Francisco with me. I just want the story,

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Speaker 5: the DOCU signed story, right. I think historically you've beat

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Speaker 5: the market's expectations on billings, and so everyone was very excited.

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Speaker 5: They're a little concerned on that. The story behind billings growth.

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Speaker 8: Well, you know, so.

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Speaker 2: When I joined a little out of two years ago,

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Speaker 2: I think there were three questions. One, could we stabilize

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Speaker 2: the business, could we become more efficient? And then could

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Speaker 2: we develop our next chapter? And so this quarter I

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Speaker 2: think is a nice milestone. I think we have really

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Speaker 2: stabilized the business. We've made the business much more efficient,

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Speaker 2: the profitability as you mentioned, and we are now poised,

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Speaker 2: I think for growth. We've launched our new product line,

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Speaker 2: which is much broader than the signature that everyone's so

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Speaker 2: familiar with, and we saw some early, very positive results

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Speaker 2: this quarter. It's still early, but we're very encouraging.

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Speaker 6: Dig into those positive results. AI Infused. We're thinking about

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Speaker 6: broadening out from contracts. How is it working for the

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Speaker 6: companies that use it?

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Speaker 2: Yes, So we launched it to North American commercial customers

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Speaker 2: and we've had a number of folks that have not

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Speaker 2: only ordered, but deployed, and the early results are really good.

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Speaker 2: You see, what they're saying is They love the fact

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Speaker 2: that we can ingest all of their agreements and give

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Speaker 2: them immediate insight into every contract that they have. And

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Speaker 2: this is valuable for every role in the company. Whether

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Speaker 2: you're a CFO or a frontline seller or purchasing agent

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Speaker 2: or an HR recruiter. You want to know the agreements

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Speaker 2: that are relevant to you, what are the essential terms,

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Speaker 2: and how are things going. And that's what we provide,

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Speaker 2: and we can do that fairly instantaneously.

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Speaker 5: When you have an AI enabled product, or a product

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Speaker 5: is made more valuable by AI, it's usually required an

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Speaker 5: investment on the talent side or the compute side. What

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Speaker 5: can you tell me and your investors and the audience

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Speaker 5: convince us that that investment is paying off fully?

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Speaker 2: Yeah, well, so as if you look at our past

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Speaker 2: performance here, we've been doing AI for a long time.

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Speaker 2: We've had AI embedded our products since before the allms

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Speaker 2: came out, and that's been feature that we've embedded as

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Speaker 2: well as charged separately for. But obviously with the advent

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Speaker 2: of these new models, we were able to take a

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Speaker 2: significantly forward. And the feature that I just described is

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Speaker 2: AIAI enabled so we take your contract data, run it

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Speaker 2: through some of these models, score them and then give

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Speaker 2: you back the central data about your agreements, and we

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Speaker 2: could do that in a very lightweight, instantaneous way. From

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Speaker 2: an investment perspective, we have ramped up our investment in

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Speaker 2: product and technology, and we are moving to the public cloud.

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Speaker 2: We have a big partnership with Microsoft. But I think

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Speaker 2: we're holding the line pretty well on expenses. We can

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Speaker 2: do this efficiently, and of course the costs of AI

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Speaker 2: continue to drop. The cost of processing and agreement has

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Speaker 2: dropped tremendously to the last six months.

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Speaker 6: We're looking at the moment at an interday, you're up

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Speaker 6: three point seven percent. I look back over the five years.

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Speaker 6: At one point your share price it clips three hundred,

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Speaker 6: And I'm just wondering as to whether you think this AI,

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Speaker 6: your foury, is ever going to infuse itself into the

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Speaker 6: capitalization the market capitalization of your business once again on

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Speaker 6: as the pandemic did once before.

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Speaker 2: Well, I think you know those were days when doc

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Speaker 2: time's growing at fifty sixty percent a year. So I

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Speaker 2: don't know that we have a path to that yet.

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Speaker 2: I certainly love that, but I'm not projecting that. I

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Speaker 2: think for now we're setting ourselves a milestone and return

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Speaker 2: to double digit profitable growth.

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Speaker 8: I think we have a.

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Speaker 2: Path to that, and the early signs here are encouraging,

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Speaker 2: and we'll see how the market's response to that. We're

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Speaker 2: obviously a much more profitable company now and operating at

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Speaker 2: bigger scales, so I'm not going to predict where the

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Speaker 2: market's going to value us, but we are really really

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Speaker 2: pleased with the early progress here.

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Speaker 8: It's very quickly.

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Speaker 5: Something you just said, Alan, the cost of AI is dropping.

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Speaker 5: I don't know that I've heard many people say that

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Speaker 5: to me at least, what do you mean.

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Speaker 2: Well, so, if you look at the efficiency of these

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Speaker 2: models and the cost per item process, whether it's an

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Speaker 2: image or an our case in agreement, the cost has

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Speaker 2: dropped very significantly, by a couple orders of magnitude. With

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Speaker 2: that said, obviously people are taking on more ambitious tasks,

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Speaker 2: the models are getting larger, and so the compute costs

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Speaker 2: for the large vendors, for example, the amount of capital

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Speaker 2: investment they're making is going up and up. I think

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Speaker 2: it's because of the expansiveness of the opportunity that they see.

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Speaker 2: But I'm telling you, as a customer on a per

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Speaker 2: item process perspective, costs of dropping very.

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Speaker 6: Rapidly fascinating take. We thank you so much, doctor side

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Speaker 6: An anti Guison for joining us. Now let's go elsewhere

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Speaker 6: in the C suite. Shares of enterprise automation and AI

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Speaker 6: software company UiPath that they're down in today's training following

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Speaker 6: the software companies actually ten percent revenue growth results and

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Speaker 6: a small upward revision and its recurring revenue forecast. That's

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Speaker 6: amid a CEO transition and job cuts. AT's bringing UiPath

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Speaker 6: CFO and COO Ashim Gutta for more. You're taking on

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Speaker 6: more roles and responsibilities. We're seeing an investor base that

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Speaker 6: wants certainty, that wants confidence in this period of change,

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Speaker 6: you're showing execution. Can you give them that at the

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Speaker 6: moment issue?

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Speaker 12: Yeah, And I think this quarter was a good testament

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Speaker 12: to that, Caroline. We beat our mental across the board

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Speaker 12: from what we got into last quarter. We raised our

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Speaker 12: overall operating margin and free cash flow by twenty five

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Speaker 12: million dollars, which projects our confidence in our ability to

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Speaker 12: execute both efficiently and at the same time with minimum

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Speaker 12: distraction on the top line results that we're going to

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Speaker 12: continue to drive. And then we've also executed well against

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Speaker 12: our buyback. We increased our authorization for another five hundred

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Speaker 12: million dollars, bringing to a billion dollars in total. I

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Speaker 12: think that really projects the confidence that we have in

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Speaker 12: the company and our ability to execute, and then that's

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Speaker 12: translating well in the investor discussions that we've had today.

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Speaker 6: What about executing against your competition A shame Your role

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Speaker 6: before was with about customer excellence and look service now salesforce,

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Speaker 6: they are rolling out AI agents, they're fueling productivity aims.

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Speaker 6: I'm interested to seeing your ability to compete here.

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Speaker 11: Yeah, it's a great question.

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Speaker 12: We feel very good about actually our position and the

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Speaker 12: execution of our field competing. We close the largest test

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Speaker 12: automation deal in the history of the company in one

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Speaker 12: of the world's largest tech companies. We've expanded our cloud

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Speaker 12: platform significantly. You saw that cross almost eight hundred and

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Speaker 12: fifty million dollars of arr now into our into our

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Speaker 12: overall top line results. And when you look across our

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Speaker 12: customer base, we've increased our customers greater than a million

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Speaker 12: dollars by fifteen percent year over year, and that cohort

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Speaker 12: of customers or customers greater than one hundred thousand and

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Speaker 12: two a million is expanding at one hundred twenty percent.

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Speaker 12: That shows that we're winning in the market. There's increased

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Speaker 12: competition in personal productivity, you know, smaller ROI mundane tasks

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Speaker 12: type automations. But where we're competing and where where we're

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Speaker 12: winning is in large scale enterprise automations and where AI

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Speaker 12: and automation come together. That is what customers want, and

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Speaker 12: we are winning in those types of use cases, as

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Speaker 12: evidenced by the demo that we actually provided in our

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Speaker 12: earnings call that shows them do we can have with

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Speaker 12: healthcare customers as the across the industry for a simple

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Speaker 12: use case that can save them hundreds of millions of.

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Speaker 8: Dollars A shame.

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Speaker 5: Congratulations on being given a second job on top of

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Speaker 5: the one you've already got, CFO and COO.

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Speaker 8: Now, I actually want.

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Speaker 5: To talk to you about saying I think we probably

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Speaker 5: looked at earlier in the year, which is this bigger

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Speaker 5: picture of license to subscription. There are lots of people

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Speaker 5: that watch this program where that is something that they

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Speaker 5: will confront each day because they either administer software agreements

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Speaker 5: or whatever. Can you just extrapolate out from your earnings

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Speaker 5: of what that trend looks like for you guys going forward.

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Speaker 8: Yeah, when you.

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Speaker 12: Look at our you know, we really look at our

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Speaker 12: annual recurring revenue as akin to our subscription model, and

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Speaker 12: that is growing nineteen percent at a billion five five

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Speaker 12: of skill. So we really look at that as a

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Speaker 12: very good indicator of where we are as a company

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Speaker 12: and how customers look at us as a long.

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Speaker 11: Term part of their architecture.

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Speaker 12: The second piece is our net dollar expansion rate that

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Speaker 12: is still at one hundred and fifteen percent at the.

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Speaker 11: Scale that we're at.

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Speaker 12: So when you look at you know, customers buying in

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Speaker 12: not just for one time type project, but really subscribing

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Speaker 12: to us, it's because we provide continuous and long term

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Speaker 12: value in their enterprise processes. So as you extrapolate that

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Speaker 12: forward and you say one hundred and fifteen percent net

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Speaker 12: dollar expansion rate, continuing to launch new products such as

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Speaker 12: Autopilot that is that brings natural language processing for automation

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Speaker 12: developers and puts that in their hands, and expanding our

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Speaker 12: platform into test automation, and continuing to drive more and

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Speaker 12: more complicated use cases.

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Speaker 11: We feel very good about the trajectory of that subscription

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Speaker 11: model for US.

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Speaker 8: A shame. How is your day to day going to

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Speaker 8: be different now that you so as well?

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Speaker 12: Look, I think I have a great team in finance

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Speaker 12: that has done so much and has built a great foundation. Really,

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Speaker 12: Daniel and I look at execution and driving prioritization and

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Speaker 12: then dividing and conquering where he can spend time continuing

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Speaker 12: to lead us into this agentic wave that is there.

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Speaker 12: And agentic is such a powerful wave that requires both

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Speaker 12: go to market and product innovation, and continuing our leadership

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Speaker 12: in that area is great for me to be able

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Speaker 12: to help Daniel and help the team by providing day

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Speaker 12: to day ownership over the enabling functions that really drive

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Speaker 12: our ability to execute against our broader vision. That's where

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Speaker 12: I'm going to spend more and more of my time.

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Speaker 12: It's frankly an honor and a really good part to

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Speaker 12: be a part of the larger team of viipath.

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Speaker 6: It's a hard time because you're cutting people. How much

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Speaker 6: is AI able to offset and replace some of that talent?

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Speaker 8: Yeah, we look.

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Speaker 12: I think first, as you're right, it's never easy to

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Speaker 12: part with employees. And at the same time, I think

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Speaker 12: driving continuing to drive shareholder value is important for us

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Speaker 12: and efficiency and making sure we have streamlined processes that

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Speaker 12: are there.

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Speaker 11: I think AI is a really important part of us.

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Speaker 12: We actually use our platform internally than three hundred and

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Speaker 12: fifty automations live doing everything from invoice processing to even

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Speaker 12: complex areas like vendor engagements.

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Speaker 11: That is a big part of our productivity.

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Speaker 12: With autopilot, we're able to launch that into other areas

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Speaker 12: such as our sales processes. And I think that efficiency

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Speaker 12: gives us not just productivity and dollars, but really of

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Speaker 12: mind shure to spend more time with customers and customer

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Speaker 12: centricity is a really key tenant of Daniel's priority for

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Speaker 12: the company.

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Speaker 5: As we go forward, UIPAF CFO and now COO as well. Actually,

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Speaker 5: and goodt thank you very much. Like coming up on

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Speaker 5: the program, Americans are shifting their stance on a potential

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Speaker 5: TikTok ban. We'll have all the details next And as

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Speaker 5: we head to the break, take another look at the

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Speaker 5: NASDAQ one hundred actually trading their session lows, now heading

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Speaker 5: for its biggest weekly decline since November twenty twenty two,

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Speaker 5: down two and a half two point four percent. In

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Speaker 5: this session, you can see the little sort of spike

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Speaker 5: or pair in those losses. After the faire wallerheads, we'll

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Speaker 5: talk more about the markets in the hour. This has

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Speaker 5: boonbo technology. It's time now for talking tech and first start.

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Speaker 5: Americans are less supportive of a possible TikTok ban than

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Speaker 5: they were eighteen months ago. According to a new Pew

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Speaker 5: Research survey, just thirty two percent of US adults back

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Speaker 5: a TikTok ban, while that number was at fifty percent

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Speaker 5: back in March of last year. Plus TikTok parent Bike

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Speaker 5: Dance is raising as much as six hundred million dollars

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Speaker 5: for its car information and trading platform, dong Cheede. According

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Speaker 5: to sources, The fundraising round values the platform at close

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Speaker 5: to three billion dollars. And Telegram CEO Pavel Durov defended

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Speaker 5: the encryptive messaging app in his first public comments since

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Speaker 5: being arrested in Paris last month. He acknowledged quote growing

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Speaker 5: pains from a rapid expansion to nine hundred and fifty

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Speaker 5: million users and promise to tackle criminal abuse.

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Speaker 6: Character it's just take a look at these markets and

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Speaker 6: anticipate what we're discussing next. Broadcon I mean slumping on

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Speaker 6: the back of its numbers. They were pretty strong in

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Speaker 6: Ai but the forecast disappointed word by nine percent and

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Speaker 6: the NASAQ one hundred offer five point six percent over

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Speaker 6: the last five training days, the worst week since November

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Speaker 6: twenty twenty two. This is Blue Meg Technology. Welcome back

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Speaker 6: to Blue Meg Technology. I'm Caroline Heid in New York.

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Speaker 8: And I'm Ed Ludlow in San Francisco.

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Speaker 6: It is a brutal end to this week. When it

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Speaker 6: comes to being long these markets, it is the macro data,

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Speaker 6: the job's data showing once again a calling in that

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Speaker 6: job's market. Wage growth ticked up, but overall we are

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Speaker 6: looking for reasons to sell it fields this Friday and

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Speaker 6: we are down on the NASA by two point three percent.

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Speaker 6: In fact, the Nasdaq one hundred having its worst week

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Speaker 6: since twenty twenty two. We're on a risk averse environment,

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Speaker 6: so bomb market catches a bid. The two year yield

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Speaker 6: falls down some nine basis points, off of some fourteen

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Speaker 6: basis point collapse earlier in the day. This as we

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Speaker 6: start to bake in, is there a fifty basis point

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Speaker 6: cut as soon as September. I'm looking at bitcoin also

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Speaker 6: basically in line with risk sentiment. We're off by three

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Speaker 6: point three percent. Look at what so many individual movers

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Speaker 6: are doing. I just want to shine a light on

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Speaker 6: what a brutal week it has been also for chips.

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Speaker 6: More broadly, the socks off by another four percent. We're

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Speaker 6: basically down nine ten percent on the week. Broad Com

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Speaker 6: today is the victim of choice, and we're currently seeing

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Speaker 6: it collapse in percentage point perspective, even though it's forecast

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Speaker 6: like relatively bright. We're going to dig into that on

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Speaker 6: a micro basis, but also super microcomputers. Get this, JP

440
00:23:40,800 --> 00:23:43,680
Speaker 6: Morgan slashing its price target on this company all the

441
00:23:43,720 --> 00:23:46,320
Speaker 6: way down to five hundred, nine hundred and fifty after

442
00:23:46,400 --> 00:23:48,959
Speaker 6: short seller note we're worried about it's ten k. When

443
00:23:49,040 --> 00:23:51,159
Speaker 6: it gets back into compliance is when you're going to

444
00:23:51,200 --> 00:23:53,800
Speaker 6: have to sit on the sidelines until ed. But let's

445
00:23:53,840 --> 00:23:55,280
Speaker 6: just dig into what's happening with Broadcon.

446
00:23:56,000 --> 00:23:57,960
Speaker 8: Yeah, the Broadcom story is important.

447
00:23:58,080 --> 00:24:01,920
Speaker 5: Falling after the company delivered it's sales forecast, which was

448
00:24:02,000 --> 00:24:03,960
Speaker 5: hurt by the parts of its business that are not

449
00:24:04,600 --> 00:24:07,600
Speaker 5: tied to artificial intelligence. I want to bring in Congensubani

450
00:24:07,640 --> 00:24:10,800
Speaker 5: from Bloomberg Intelligence and Okay, so the fistful fourth quarter

451
00:24:11,320 --> 00:24:15,160
Speaker 5: overall revenues fourteen billion not as strong as hoped full

452
00:24:15,240 --> 00:24:17,639
Speaker 5: fiscal year twelve billion dollars in AI sales.

453
00:24:17,720 --> 00:24:18,120
Speaker 8: That's good.

454
00:24:18,640 --> 00:24:22,360
Speaker 5: So we're basically concluding that this sort of more legacy

455
00:24:22,440 --> 00:24:24,639
Speaker 5: businesses for Broadcom aren't doing as well right now?

456
00:24:24,720 --> 00:24:26,199
Speaker 8: Is that your Reid exactly?

457
00:24:26,280 --> 00:24:29,040
Speaker 13: I mean, that was the only negative, But in my opinion,

458
00:24:29,119 --> 00:24:30,960
Speaker 13: it was not very surprising if we have heard the

459
00:24:31,080 --> 00:24:34,040
Speaker 13: same story across of most of its peers who have

460
00:24:34,080 --> 00:24:37,080
Speaker 13: already reported, because remember Broadcom is the last one to report,

461
00:24:37,320 --> 00:24:39,520
Speaker 13: so that should not have caused this kind of a reaction.

462
00:24:39,840 --> 00:24:42,680
Speaker 13: I think another thing going here is the AI which

463
00:24:42,760 --> 00:24:45,480
Speaker 13: was upsided to twelve billion. Maybe investors were hoping for

464
00:24:45,600 --> 00:24:46,920
Speaker 13: even stronger upside there.

465
00:24:47,080 --> 00:24:50,600
Speaker 5: That's been the story of this entire earning season. I

466
00:24:50,680 --> 00:24:53,160
Speaker 5: do want to look at the sort of non AI

467
00:24:53,359 --> 00:24:56,800
Speaker 5: part because, as you know, Apple and Monday and the iPhone,

468
00:24:57,760 --> 00:24:59,960
Speaker 5: did we learn anything new about that business?

469
00:25:00,040 --> 00:25:04,280
Speaker 8: Yes, and perhaps the trajectory of it not.

470
00:25:04,440 --> 00:25:07,720
Speaker 13: Really from along with Broadcom and Qualcom and other chip players,

471
00:25:07,800 --> 00:25:12,720
Speaker 13: we have not seen significantly stronger than seasonal outlooks coming

472
00:25:12,760 --> 00:25:15,639
Speaker 13: into this iPhone launch, despite the reports that we have

473
00:25:15,680 --> 00:25:18,520
Speaker 13: been hearing that Apple iPhone shipments are preparing for five

474
00:25:18,600 --> 00:25:22,280
Speaker 13: to ten percent higher shipman volume this year now, twenty

475
00:25:22,359 --> 00:25:24,480
Speaker 13: twenty three was a down year, so we do expect

476
00:25:24,600 --> 00:25:26,720
Speaker 13: volumes to be higher because of that, but we are

477
00:25:26,760 --> 00:25:30,000
Speaker 13: not seeing anything out of ordinary from at least Broadcom.

478
00:25:30,119 --> 00:25:33,280
Speaker 6: Yesterday. I want to go to what sort of truest

479
00:25:33,359 --> 00:25:36,320
Speaker 6: securities are saying. I hope to name other people on

480
00:25:36,400 --> 00:25:38,840
Speaker 6: the street, congen because your expertise is so important to us,

481
00:25:38,880 --> 00:25:41,920
Speaker 6: But he's saying, basically, it's unpredictable. It's a lumpy when

482
00:25:41,960 --> 00:25:44,400
Speaker 6: it comes to AI revenue growth. Because as and when

483
00:25:44,440 --> 00:25:46,919
Speaker 6: we're going to get customers named, we were thinking there

484
00:25:46,960 --> 00:25:50,280
Speaker 6: might be more. When will we hear of actual customers

485
00:25:50,400 --> 00:25:51,760
Speaker 6: warning that chips made by Broadcom?

486
00:25:52,160 --> 00:25:54,440
Speaker 13: Well, at this point it's not clear, but you know

487
00:25:54,560 --> 00:25:58,119
Speaker 13: the fact about being it lumpy, that's true. However, does

488
00:25:58,440 --> 00:26:00,680
Speaker 13: that should not take away anything from the strength of

489
00:26:00,760 --> 00:26:01,120
Speaker 13: the growth.

490
00:26:01,760 --> 00:26:03,240
Speaker 8: We expect both the.

491
00:26:03,280 --> 00:26:06,760
Speaker 13: Ask and the connectivity businesses to grow even stronger next year.

492
00:26:07,080 --> 00:26:11,280
Speaker 13: And remember these are still very highly concentrated, few customers

493
00:26:11,359 --> 00:26:13,639
Speaker 13: three at this point, so you are going to expect

494
00:26:13,720 --> 00:26:16,439
Speaker 13: lumpiness from quarter to quarter as they adjust their timing

495
00:26:16,520 --> 00:26:17,800
Speaker 13: of purchases and buildouts.

496
00:26:18,800 --> 00:26:22,000
Speaker 6: We asked you yesterday a slightly unfair question, but I

497
00:26:22,119 --> 00:26:24,040
Speaker 6: ask it to you again because you are a fundamentally

498
00:26:24,359 --> 00:26:27,159
Speaker 6: driven person. But the market just seemed to be so

499
00:26:27,359 --> 00:26:30,080
Speaker 6: exuberant around these AI names. We've got a deja vu.

500
00:26:30,359 --> 00:26:33,240
Speaker 6: Nvidia sold off when its numbers were good, broadclm doing.

501
00:26:33,119 --> 00:26:35,840
Speaker 13: The same exactly. I mean, what we're seeing is even

502
00:26:35,960 --> 00:26:38,920
Speaker 13: solid or strong reports are not strong enough because the

503
00:26:39,000 --> 00:26:42,480
Speaker 13: expectations are just stronger higher than that. But I just

504
00:26:42,600 --> 00:26:45,040
Speaker 13: remind people to go back to fundamentals and see. We

505
00:26:45,119 --> 00:26:47,200
Speaker 13: saw the same thing again from Broadcom, we saw from

506
00:26:47,240 --> 00:26:50,320
Speaker 13: in media. The demand signals keep going stronger and stronger.

507
00:26:50,600 --> 00:26:53,600
Speaker 13: Their bookings and backlocks continue to increase. So there's no

508
00:26:53,800 --> 00:26:57,240
Speaker 13: such real fundamental risk factors here, especially when it comes

509
00:26:57,280 --> 00:26:58,040
Speaker 13: to AI chips.

510
00:26:58,560 --> 00:27:01,920
Speaker 6: Kanjan Sabani, thank you for your expertise being meg Intelligence.

511
00:27:02,520 --> 00:27:06,080
Speaker 6: Now let's talk about another chip name. Intel is considering

512
00:27:06,400 --> 00:27:09,560
Speaker 6: options for its stake and it's struggling automated driving systems

513
00:27:09,560 --> 00:27:12,880
Speaker 6: to provide a Mobili as part of a major strategy overhaul.

514
00:27:13,040 --> 00:27:15,200
Speaker 6: That's all according to sources who say the chip maker

515
00:27:15,400 --> 00:27:18,080
Speaker 6: could offload just some of its eighty eight percent holding

516
00:27:18,119 --> 00:27:20,920
Speaker 6: a Mobili on the public market or via sale to

517
00:27:20,960 --> 00:27:23,560
Speaker 6: a third party shares a mobili as you can see,

518
00:27:23,840 --> 00:27:27,760
Speaker 6: falling to a record loan in King joining us. The

519
00:27:27,920 --> 00:27:31,359
Speaker 6: nuance is important here Ian, but this is a company

520
00:27:31,440 --> 00:27:34,560
Speaker 6: struggling to do something to change its poor fortunes.

521
00:27:35,280 --> 00:27:36,199
Speaker 3: Yeah. Two things here.

522
00:27:36,520 --> 00:27:39,040
Speaker 4: First one is, let's put this in a world context.

523
00:27:39,160 --> 00:27:42,760
Speaker 4: Right Intel needs money to execute on.

524
00:27:43,119 --> 00:27:45,200
Speaker 3: This ambitious plan that it's put together.

525
00:27:45,480 --> 00:27:48,280
Speaker 4: Doesn't really have that amount of money from its operations

526
00:27:48,400 --> 00:27:52,040
Speaker 4: right now, is having to scale back some of the ambitions.

527
00:27:52,119 --> 00:27:54,920
Speaker 4: And it's also looking at, you know, other parts of

528
00:27:55,520 --> 00:27:58,280
Speaker 4: what it has and whether those can be monetized in

529
00:27:58,440 --> 00:28:01,920
Speaker 4: some way or find better value in some way. MOBILEI

530
00:28:02,040 --> 00:28:04,639
Speaker 4: would obviously be a part of that, and it's already

531
00:28:04,800 --> 00:28:08,119
Speaker 4: made moves in that direction, selling a stake in the

532
00:28:08,200 --> 00:28:10,879
Speaker 4: IPO and then selling a further steak.

533
00:28:11,040 --> 00:28:13,280
Speaker 3: But and the important but here is if you look

534
00:28:13,359 --> 00:28:16,680
Speaker 3: at where MOBILEI is a relative to what Intel.

535
00:28:16,440 --> 00:28:19,520
Speaker 4: Paid, which is considerably lower, it wouldn't make sense to

536
00:28:19,640 --> 00:28:22,800
Speaker 4: just be dumping it right now unless you could find

537
00:28:22,960 --> 00:28:25,399
Speaker 4: an individual seller that would be willing to pay the

538
00:28:25,480 --> 00:28:26,920
Speaker 4: price that you paid or better.

539
00:28:27,480 --> 00:28:29,320
Speaker 8: There are some basics that we should go over.

540
00:28:29,400 --> 00:28:32,119
Speaker 5: I think you know, Intel has been over a period

541
00:28:32,160 --> 00:28:36,040
Speaker 5: of time chipping away at its stake in mobili anyway.

542
00:28:36,680 --> 00:28:40,200
Speaker 5: But our understanding from sources in right is that Intel's

543
00:28:40,240 --> 00:28:42,360
Speaker 5: looking at a lot of different things, and I think

544
00:28:42,440 --> 00:28:45,120
Speaker 5: on the Mobilize side, you know, their board's got to

545
00:28:45,120 --> 00:28:47,600
Speaker 5: get together at some point embrace for something that might

546
00:28:47,680 --> 00:28:48,520
Speaker 5: potentially happen.

547
00:28:49,560 --> 00:28:49,760
Speaker 2: Yeah.

548
00:28:49,800 --> 00:28:54,240
Speaker 4: I mean again, putting Mobile in the general context of

549
00:28:54,320 --> 00:28:57,720
Speaker 4: Intel is probably the safest thing to do.

550
00:28:57,880 --> 00:29:02,240
Speaker 3: Here, what used to be called Terror another Intel acquisition.

551
00:29:02,680 --> 00:29:06,280
Speaker 4: They've already started to move that towards independent status. There

552
00:29:06,320 --> 00:29:10,480
Speaker 4: are other business divisions within Intel that perhaps aren't as

553
00:29:11,080 --> 00:29:12,960
Speaker 4: central to the care of what it does.

554
00:29:13,400 --> 00:29:16,680
Speaker 3: And you know, we had this FO this week talking

555
00:29:16,760 --> 00:29:17,360
Speaker 3: at a conference.

556
00:29:17,440 --> 00:29:20,240
Speaker 4: We had the CEO last week talking at a conference

557
00:29:20,280 --> 00:29:22,360
Speaker 4: on They're saying, look, we're looking at these things.

558
00:29:22,480 --> 00:29:23,960
Speaker 3: We want to be streamlined.

559
00:29:24,000 --> 00:29:29,040
Speaker 4: We want to be quicker to respond to the circumstances

560
00:29:29,080 --> 00:29:30,800
Speaker 4: that we're in and be able to make the kind

561
00:29:30,840 --> 00:29:33,520
Speaker 4: of decisions and rapidly deploy capital to make sure we

562
00:29:33,640 --> 00:29:38,200
Speaker 4: take hold of opportunities. At the same time, Mobilized not

563
00:29:38,320 --> 00:29:40,480
Speaker 4: in the great shape the old terror business is and

564
00:29:40,560 --> 00:29:44,000
Speaker 4: the fantastic shape. So it's a difficult set of circumstances

565
00:29:44,320 --> 00:29:47,160
Speaker 4: and they've not really made concrete decisions yet, is what

566
00:29:47,240 --> 00:29:49,600
Speaker 4: we've been made to understand.

567
00:29:49,760 --> 00:29:51,280
Speaker 6: I mean, this is a bad time to have to

568
00:29:51,360 --> 00:29:53,720
Speaker 6: offload Mobile. I when shares have been off by what's

569
00:29:53,760 --> 00:29:57,000
Speaker 6: seventy percent year to date, can you remind us of

570
00:29:57,080 --> 00:29:58,520
Speaker 6: the issues that are going on there?

571
00:29:59,160 --> 00:29:59,360
Speaker 14: Yeah?

572
00:29:59,400 --> 00:30:04,240
Speaker 4: I mean, anybody who has been playing into the auto

573
00:30:04,360 --> 00:30:08,000
Speaker 4: market going back two three years ago, was you were

574
00:30:08,080 --> 00:30:08,760
Speaker 4: a bell of the ball.

575
00:30:08,840 --> 00:30:09,720
Speaker 3: You were fantastic.

576
00:30:10,160 --> 00:30:12,520
Speaker 4: The whole world was going ev the whole world was

577
00:30:12,560 --> 00:30:14,960
Speaker 4: going self driving, we were going to have robot taxis

578
00:30:15,000 --> 00:30:19,560
Speaker 4: on every street corner. Clearly, what's happening and this, whether

579
00:30:19,600 --> 00:30:22,400
Speaker 4: your mobilize, whether you're Intel, whether you're in video, whether

580
00:30:22,440 --> 00:30:25,960
Speaker 4: you're anybody, that hasn't happened at the pace with which

581
00:30:26,240 --> 00:30:29,880
Speaker 4: some had projected. And Mobile has been a victim of

582
00:30:30,000 --> 00:30:32,160
Speaker 4: that kind of up and down cycle, and if you

583
00:30:32,240 --> 00:30:34,720
Speaker 4: look at you know it clearly has had a bad

584
00:30:35,120 --> 00:30:37,440
Speaker 4: particularly in the first quarter earnings.

585
00:30:37,000 --> 00:30:40,040
Speaker 3: Reports that have obviously dim sentiment considerably.

586
00:30:40,920 --> 00:30:44,600
Speaker 4: Long term, everybody believes in the direction that they're heading

587
00:30:44,640 --> 00:30:46,560
Speaker 4: in and believes that they have an important role to play,

588
00:30:46,640 --> 00:30:48,880
Speaker 4: but right now they're into.

589
00:30:48,800 --> 00:30:52,520
Speaker 5: Spot Bloombergsine and King along with the team reporting so

590
00:30:52,720 --> 00:30:56,040
Speaker 5: deeply on this thank you. In the chip sector, TSMC

591
00:30:56,440 --> 00:31:01,160
Speaker 5: achieved production yields and it's Arizona facility on par with

592
00:31:01,400 --> 00:31:05,120
Speaker 5: established plants back home, an early indicator that its Marquee

593
00:31:05,240 --> 00:31:08,440
Speaker 5: US project is on track to achieve its targets. That's

594
00:31:08,440 --> 00:31:12,080
Speaker 5: according to a source, TSMC had said it started engineering

595
00:31:12,120 --> 00:31:17,120
Speaker 5: wafer production in April with advanced four nanometer process technology,

596
00:31:17,160 --> 00:31:19,800
Speaker 5: and we've been tracking their progress there. I think, Caroline,

597
00:31:19,800 --> 00:31:22,680
Speaker 5: we should go back to what's happening in markets. And basically,

598
00:31:23,120 --> 00:31:27,080
Speaker 5: since we got those comments from fed Waller, bonds have rallied,

599
00:31:27,480 --> 00:31:30,760
Speaker 5: and despite a moment of relief, the story is still

600
00:31:30,800 --> 00:31:34,720
Speaker 5: equities under pressure with that pressure coming from technology, I think.

601
00:31:35,000 --> 00:31:37,080
Speaker 6: Yeah, if you're looking at some of the key points

602
00:31:37,160 --> 00:31:40,880
Speaker 6: drags on the SMP, it is currently no Surprise in

603
00:31:41,040 --> 00:31:44,000
Speaker 6: video dragging us down by some fourteen points. We've got

604
00:31:44,040 --> 00:31:46,480
Speaker 6: Broadcom dragging us lower. But then who's who of the

605
00:31:46,560 --> 00:31:51,120
Speaker 6: mags seven, Amazon, Microsoft, Tesla, Google, Meta, Apple, No wonder

606
00:31:51,200 --> 00:31:54,120
Speaker 6: you're seeing such a pressure across the board on the benchmarks.

607
00:31:54,320 --> 00:31:56,360
Speaker 6: And then this has been an ugly week. More broadly,

608
00:31:56,480 --> 00:31:58,720
Speaker 6: then aw's that one hundred having its worst week since

609
00:31:58,720 --> 00:31:59,600
Speaker 6: twenty twenty two.

610
00:32:00,560 --> 00:32:03,040
Speaker 5: And real quick just bitcoin for what it's worth, continuing

611
00:32:03,080 --> 00:32:05,800
Speaker 5: this slide down more than three percent below fifty five

612
00:32:05,880 --> 00:32:08,640
Speaker 5: thousand US dollars for token. Good job getting that up, guys,

613
00:32:08,680 --> 00:32:10,600
Speaker 5: I appreciate it. I went a little bit rogue there.

614
00:32:10,920 --> 00:32:14,000
Speaker 5: But there's a lot happening in real time on the week,

615
00:32:14,080 --> 00:32:16,560
Speaker 5: as you know, Carro a tough week broadly for risk.

616
00:32:16,400 --> 00:32:19,960
Speaker 6: Assets totally and volumes actually up on the SMP for

617
00:32:20,040 --> 00:32:21,960
Speaker 6: this Friday. But coming up, we want to dig into

618
00:32:22,000 --> 00:32:24,520
Speaker 6: the micro news again. A UK watchdog is sending a

619
00:32:24,600 --> 00:32:27,239
Speaker 6: warning to Google saying it abuses one area of its

620
00:32:27,280 --> 00:32:30,479
Speaker 6: business that accounts to eighty percent total revenue. You can

621
00:32:30,520 --> 00:32:47,840
Speaker 6: guess what it is. This is a blood technology. Now

622
00:32:47,920 --> 00:32:50,920
Speaker 6: the Biden administration is preparing strict to export rules for

623
00:32:51,120 --> 00:32:54,880
Speaker 6: quantum computing and semiconductive products. It's once again taking aim

624
00:32:55,000 --> 00:32:57,920
Speaker 6: at China Room Megs Mackenzie Hawkins joins us for more

625
00:32:58,120 --> 00:33:02,440
Speaker 6: and this is getting ever clutting edge. Mackenzie right.

626
00:33:02,560 --> 00:33:05,280
Speaker 14: So the rules that we saw the Baden administration released

627
00:33:05,320 --> 00:33:07,720
Speaker 14: yesterday as an interim final rule, meaning there's still a

628
00:33:07,760 --> 00:33:11,080
Speaker 14: comment period, nothing is quite set in stone. Are trying

629
00:33:11,120 --> 00:33:14,560
Speaker 14: to take aim at sort of the next generation of technologies,

630
00:33:14,640 --> 00:33:17,360
Speaker 14: looking at a chip architecture called gate all Around that's

631
00:33:17,400 --> 00:33:19,720
Speaker 14: expected to be widely introduced into the market next year,

632
00:33:20,160 --> 00:33:23,760
Speaker 14: as well as cutting edge quantum computing and computer components,

633
00:33:24,560 --> 00:33:27,360
Speaker 14: sort of trying to align with countries around the world

634
00:33:27,400 --> 00:33:30,960
Speaker 14: that have also introduced similar or in some cases identical

635
00:33:31,080 --> 00:33:35,320
Speaker 14: rules and by doing so limit themselves from the impact

636
00:33:35,400 --> 00:33:36,480
Speaker 14: of US export control.

637
00:33:36,560 --> 00:33:38,440
Speaker 11: So we have this sort of global coalition forming.

638
00:33:38,480 --> 00:33:40,800
Speaker 14: It includes the US, Japan, and the Netherlands, which are

639
00:33:40,840 --> 00:33:43,160
Speaker 14: home to key countries and the chip supply chain, as

640
00:33:43,200 --> 00:33:46,040
Speaker 14: well as other allies such as the UK, Canada.

641
00:33:45,720 --> 00:33:48,280
Speaker 8: And Italy. Mackenzie and your story.

642
00:33:48,920 --> 00:33:53,959
Speaker 5: You quote Alan Estevez, who runs the Commerce Department's Bureau

643
00:33:54,080 --> 00:33:57,080
Speaker 5: of Industry and Security, and in the quote he talks

644
00:33:57,080 --> 00:34:02,040
Speaker 5: about the alignment of controls being I'm going to read

645
00:34:02,080 --> 00:34:08,200
Speaker 5: it frankly difficult for our adversaries. So adversaries is different

646
00:34:08,400 --> 00:34:11,320
Speaker 5: kind of words competitives. Can you just explain the strategy

647
00:34:11,400 --> 00:34:12,000
Speaker 5: from the US.

648
00:34:12,719 --> 00:34:15,480
Speaker 14: So a lot of the US measures on chips and

649
00:34:15,600 --> 00:34:19,080
Speaker 14: other emerging technologies are specifically geared towards China as well

650
00:34:19,160 --> 00:34:22,239
Speaker 14: as Russia, North Korea and Iran. So we're talking about

651
00:34:22,280 --> 00:34:26,680
Speaker 14: geopolitical adversaries as opposed to just cutting edge technological rivals.

652
00:34:27,400 --> 00:34:28,960
Speaker 11: The US has companies that of.

653
00:34:29,000 --> 00:34:32,800
Speaker 14: Course have significant foreign rivals headquartered in US allied countries,

654
00:34:33,160 --> 00:34:35,200
Speaker 14: and this is not trying to get at those companies,

655
00:34:35,239 --> 00:34:39,200
Speaker 14: but rather at the ability of particularly Beijing, to develop

656
00:34:39,320 --> 00:34:42,320
Speaker 14: cutting edge technologies that Washington warriors could run China a

657
00:34:42,400 --> 00:34:45,520
Speaker 14: military edge. And the US has been leading this push

658
00:34:45,600 --> 00:34:48,319
Speaker 14: for several years. But you know, while this particular rule

659
00:34:48,400 --> 00:34:52,000
Speaker 14: is an example of pretty significant multilateral alignment, there are

660
00:34:52,040 --> 00:34:55,000
Speaker 14: also really difficult measures that the US is asking allied

661
00:34:55,040 --> 00:34:58,880
Speaker 14: governments to impose. Who are worried about retaliation from China

662
00:34:59,120 --> 00:35:01,840
Speaker 14: or don't necessary only buy into the same degree of

663
00:35:01,960 --> 00:35:04,960
Speaker 14: national security and geopolitical threat felt here in DC.

664
00:35:05,280 --> 00:35:08,680
Speaker 5: Bloomberg's Mackenzie Hawkins with more important reporting, thank you very

665
00:35:09,280 --> 00:35:12,880
Speaker 5: much from China to the United Kingdom. Britain's Competition and

666
00:35:13,040 --> 00:35:18,000
Speaker 5: Markets Authorities says Alphabet's Google is abusing its dominant position

667
00:35:18,239 --> 00:35:22,080
Speaker 5: in advertising technology, paving the way for potential finds and

668
00:35:22,280 --> 00:35:27,160
Speaker 5: changes to one of Google's most lucrative businesses. Bloomberg's Catherine

669
00:35:27,160 --> 00:35:30,920
Speaker 5: Gammill joins US and reported on the news the CMA

670
00:35:31,200 --> 00:35:34,480
Speaker 5: what is the basic conclusion that they've reached.

671
00:35:36,040 --> 00:35:39,759
Speaker 1: Yes, So today the CMA announced its statement of objections

672
00:35:39,800 --> 00:35:42,719
Speaker 1: that it's sent to Google. So these are preliminary findings

673
00:35:42,880 --> 00:35:46,680
Speaker 1: that Google has broken competition law here by using its

674
00:35:46,760 --> 00:35:50,520
Speaker 1: dominant market possession and the add tech sector to favor

675
00:35:50,520 --> 00:35:53,920
Speaker 1: its own services. So these preliminary findings are still at

676
00:35:53,920 --> 00:35:56,600
Speaker 1: the primary stage, but this basically means that Google's using

677
00:35:56,640 --> 00:35:59,839
Speaker 1: its powers to take the competition away, and it means

678
00:36:00,000 --> 00:36:04,200
Speaker 1: that you know, UK advertisers and other services are losing out.

679
00:36:04,120 --> 00:36:07,960
Speaker 6: Because of that. The CMA, it's got tathe, right, Catherine,

680
00:36:08,080 --> 00:36:09,280
Speaker 6: kind of exists some pressure.

681
00:36:11,000 --> 00:36:12,600
Speaker 1: Yeah, it does have teethe and we've seen that with

682
00:36:12,719 --> 00:36:14,960
Speaker 1: its recent probes over the years, and you know, it's

683
00:36:14,960 --> 00:36:18,680
Speaker 1: grown prominence. I think that it's really interesting that now

684
00:36:18,800 --> 00:36:22,279
Speaker 1: the UK has joined the EU and the US and

685
00:36:22,400 --> 00:36:25,640
Speaker 1: these similar probes. And on Monday we've got the DJ's

686
00:36:25,719 --> 00:36:28,640
Speaker 1: case against Google for ad tech and last year as

687
00:36:28,680 --> 00:36:31,640
Speaker 1: well in Europe we got these charges laid out on

688
00:36:31,680 --> 00:36:34,320
Speaker 1: the ad tech sector. So, you know, Google is in

689
00:36:34,400 --> 00:36:36,799
Speaker 1: a bit of trouble here because it's got three major

690
00:36:36,840 --> 00:36:38,840
Speaker 1: global regulators that are on its back for this.

691
00:36:39,840 --> 00:36:43,560
Speaker 6: It's in trouble because also it could be fined quite

692
00:36:43,560 --> 00:36:46,360
Speaker 6: a lot of money. I just want to go into

693
00:36:46,440 --> 00:36:49,360
Speaker 6: what Google's actual responses said, Catherine, what have they told you,

694
00:36:49,440 --> 00:36:53,520
Speaker 6: because ultimately they dispute it. Yeah, one hundred percent.

695
00:36:53,600 --> 00:36:56,719
Speaker 1: So Google's response today was that the cmea's findings are

696
00:36:56,760 --> 00:36:59,160
Speaker 1: based on flawed understanding of the markets.

697
00:36:59,360 --> 00:37:01,360
Speaker 6: It said, it's this agreed and it will respond to this.

698
00:37:01,840 --> 00:37:04,240
Speaker 1: So at this stage with the statement of objections, Google

699
00:37:04,280 --> 00:37:06,640
Speaker 1: can respond and then the cme will then come to

700
00:37:06,680 --> 00:37:10,200
Speaker 1: a final conclusion from a separate panel. After that, in

701
00:37:10,320 --> 00:37:13,640
Speaker 1: the UK, findings from these sorts of investigations it can

702
00:37:13,760 --> 00:37:15,480
Speaker 1: be up to ten percent of global turnover.

703
00:37:15,800 --> 00:37:16,960
Speaker 6: That's a really extreme end.

704
00:37:17,600 --> 00:37:20,160
Speaker 1: Or they can also, you know, offer other sort of

705
00:37:20,280 --> 00:37:22,280
Speaker 1: remedies that might be able to solve this issue.

706
00:37:22,320 --> 00:37:23,239
Speaker 6: Whatever issue have got.

707
00:37:23,560 --> 00:37:24,960
Speaker 1: I mean, it is worth bearing in the mind of

708
00:37:25,000 --> 00:37:27,719
Speaker 1: the US and the EU have both said that they

709
00:37:27,760 --> 00:37:28,920
Speaker 1: would like divestments of.

710
00:37:30,400 --> 00:37:31,839
Speaker 6: Google's ad tech as well.

711
00:37:33,160 --> 00:37:35,759
Speaker 5: I've heard this before, sort of Google basically saying, you

712
00:37:35,880 --> 00:37:39,279
Speaker 5: don't understand the market that you're trying to address, but

713
00:37:39,400 --> 00:37:41,520
Speaker 5: there are other participants in the market. I'm assuming the

714
00:37:41,600 --> 00:37:45,879
Speaker 5: CMA spoke to the advertisers themselves what's their position.

715
00:37:45,640 --> 00:37:46,080
Speaker 8: In all of it.

716
00:37:47,640 --> 00:37:49,160
Speaker 1: Yeah, so, I mean this has been a long run

717
00:37:49,239 --> 00:37:53,160
Speaker 1: in investigation from the CME. These competition sort of probes

718
00:37:53,200 --> 00:37:55,239
Speaker 1: can go on for years. This one has been going

719
00:37:55,280 --> 00:37:57,320
Speaker 1: on for two years, and the CMA does talk to

720
00:37:57,320 --> 00:38:02,280
Speaker 1: a broad range of market participants. We didn't get specifics

721
00:38:02,320 --> 00:38:05,279
Speaker 1: on that today, but that's something that they've they've brought

722
00:38:05,320 --> 00:38:08,520
Speaker 1: up previously in their studies on digital advertisement and other

723
00:38:08,640 --> 00:38:09,200
Speaker 1: things as well.

724
00:38:10,120 --> 00:38:12,600
Speaker 8: Bloomberg's Catherine Gemmel out of London, thank you very much.

725
00:38:12,719 --> 00:38:15,279
Speaker 5: Let's get to another story that we're watching, and that's

726
00:38:15,400 --> 00:38:19,560
Speaker 5: dark Trace CEO Poppy Gustaffson will be leaving the British

727
00:38:19,560 --> 00:38:23,759
Speaker 5: cybersecurity firm effective today. This is the company gets absorbed

728
00:38:24,080 --> 00:38:27,959
Speaker 5: by pe firm Toma Bravo. Gustavhfsen co founded dark Trace

729
00:38:28,040 --> 00:38:30,960
Speaker 5: more than a decade ago and helped to position the

730
00:38:31,000 --> 00:38:33,600
Speaker 5: company for its IPO in twenty twenty one, as well

731
00:38:33,600 --> 00:38:36,480
Speaker 5: as its ultimate sale to Toma Bravo in April.

732
00:38:44,000 --> 00:38:47,000
Speaker 6: Apple has greenlitter version of ten cents we chat app

733
00:38:47,239 --> 00:38:50,120
Speaker 6: ahead of the company's I Phoned sixteen debut. Now the

734
00:38:50,200 --> 00:38:53,360
Speaker 6: tech giant approved and update that as new features like

735
00:38:53,520 --> 00:38:56,360
Speaker 6: moments and live streaming to the app. That's according to sources.

736
00:38:56,440 --> 00:38:59,359
Speaker 6: The approval taps down some speculation of a dispute between

737
00:38:59,360 --> 00:39:02,480
Speaker 6: the two companies over app store fees, with many believing

738
00:39:02,600 --> 00:39:05,560
Speaker 6: it could have smoothalled to a potential WeChat ban from

739
00:39:05,600 --> 00:39:07,160
Speaker 6: the latest iPhones ed.

740
00:39:08,000 --> 00:39:10,319
Speaker 5: One of the most well read stories on bloomberg dot

741
00:39:10,360 --> 00:39:13,279
Speaker 5: com this morning, Let's talk more about Apple. Apple is

742
00:39:13,400 --> 00:39:16,120
Speaker 5: holding a product launch event at its head courses on Monday,

743
00:39:16,160 --> 00:39:19,600
Speaker 5: where it's set to announce details of the iPhone sixteen

744
00:39:19,920 --> 00:39:23,000
Speaker 5: and some other new devices. Bloomberg's Mark Gunman has already

745
00:39:23,080 --> 00:39:25,960
Speaker 5: reported on and told us what to expect. But it's

746
00:39:26,040 --> 00:39:30,080
Speaker 5: work going back to the iPhone sixteen. What's different? That's

747
00:39:30,120 --> 00:39:33,080
Speaker 5: the question every year, what's actually going to make me

748
00:39:33,200 --> 00:39:34,520
Speaker 5: upgrade this time around?

749
00:39:35,080 --> 00:39:37,920
Speaker 15: Well, if you have an iPhone fifteen Pro or Promax,

750
00:39:38,120 --> 00:39:40,920
Speaker 15: I don't necessarily think you're going to upgrade this year

751
00:39:40,960 --> 00:39:42,719
Speaker 15: unless you get a pretty good deal or you're on

752
00:39:42,760 --> 00:39:43,520
Speaker 15: an upgrade path.

753
00:39:43,719 --> 00:39:43,839
Speaker 12: Right.

754
00:39:44,480 --> 00:39:46,600
Speaker 15: The changes here are going to be on the more

755
00:39:46,760 --> 00:39:49,920
Speaker 15: incremental side. We're going to focus on Apple Intelligence, which

756
00:39:49,960 --> 00:39:54,040
Speaker 15: of course the fifteen Pro in promacs will already support,

757
00:39:54,960 --> 00:39:57,360
Speaker 15: and then there's also going to be some major upgrades

758
00:39:57,400 --> 00:39:59,560
Speaker 15: on the camera. The ultra wide lens is.

759
00:39:59,560 --> 00:40:03,080
Speaker 6: Going to move to a forty eight megapixel to match.

760
00:40:03,239 --> 00:40:04,160
Speaker 11: The standard lens.

761
00:40:04,600 --> 00:40:06,400
Speaker 15: But if you're coming from an older phone, if you're

762
00:40:06,400 --> 00:40:09,880
Speaker 15: coming from a fourteen or earlier, getting Apple Intelligence, getting

763
00:40:09,920 --> 00:40:13,279
Speaker 15: those new cameras, getting the Titanium, those who are going

764
00:40:13,320 --> 00:40:15,200
Speaker 15: to be some nice upgrades. There's going to be some

765
00:40:15,320 --> 00:40:18,839
Speaker 15: new callers as well. The most significant feature is going

766
00:40:18,920 --> 00:40:21,040
Speaker 15: to be a new camera button on the right side

767
00:40:21,080 --> 00:40:23,799
Speaker 15: of the phone, next below the power button that you'll

768
00:40:23,840 --> 00:40:24,320
Speaker 15: be able.

769
00:40:24,200 --> 00:40:25,840
Speaker 8: To use take pictures and videos.

770
00:40:26,080 --> 00:40:28,520
Speaker 15: It's going to be capacitive, so you can swipe on

771
00:40:28,640 --> 00:40:31,479
Speaker 15: it to zoom in and out, move between still and video.

772
00:40:32,400 --> 00:40:34,080
Speaker 15: So that's going to be a nice upgrade there. So

773
00:40:34,160 --> 00:40:37,920
Speaker 15: it's really all about AI and the camera. The bigger changes,

774
00:40:37,920 --> 00:40:39,680
Speaker 15: of course, will come to the Apple Watch.

775
00:40:39,560 --> 00:40:40,360
Speaker 8: And the AirPods.

776
00:40:41,040 --> 00:40:43,520
Speaker 6: Bless you, Mark and just talk us about the air

777
00:40:43,600 --> 00:40:46,200
Speaker 6: pods and the Watch. What do we anticipate there, how

778
00:40:46,280 --> 00:40:47,000
Speaker 6: big a change.

779
00:40:48,480 --> 00:40:51,759
Speaker 15: So this is going to actually be the ten year

780
00:40:51,840 --> 00:40:55,280
Speaker 15: anniversary to the date of the original Apple Watch introduction

781
00:40:55,360 --> 00:40:58,799
Speaker 15: in twenty fourteen, and you're going to see a new

782
00:40:58,920 --> 00:41:01,279
Speaker 15: series ten Watch. It's going to have displays, it's a

783
00:41:01,320 --> 00:41:04,359
Speaker 15: little bit bigger. You're going to see faster processors. You're

784
00:41:04,400 --> 00:41:07,239
Speaker 15: going to see sleep apnea detection as a major new

785
00:41:07,280 --> 00:41:09,800
Speaker 15: health feature. You're also going to see that sleep appne

786
00:41:09,960 --> 00:41:12,359
Speaker 15: detection come to the Apple Watch Ultra, though that will

787
00:41:12,400 --> 00:41:15,600
Speaker 15: retain the same design that's been running since the introduction

788
00:41:15,680 --> 00:41:19,400
Speaker 15: in twenty twenty two. AirPods Apples revamping the low end

789
00:41:19,440 --> 00:41:21,000
Speaker 15: of the line, so you're going to see a new

790
00:41:21,160 --> 00:41:24,839
Speaker 15: entry level and mid tier AirPods bringing noise cancelation down

791
00:41:24,880 --> 00:41:26,719
Speaker 15: the line from the pro models for the first time.

792
00:41:27,160 --> 00:41:28,840
Speaker 15: You're going to see quite a boost there to Apples

793
00:41:28,880 --> 00:41:31,520
Speaker 15: for Wearable's business between the new watches and the new AirPods,

794
00:41:32,080 --> 00:41:34,239
Speaker 15: and I think that's going to be quite exciting for

795
00:41:34,360 --> 00:41:36,960
Speaker 15: customers who have been waiting for a new version of

796
00:41:37,000 --> 00:41:37,520
Speaker 15: the AirPods.

797
00:41:38,239 --> 00:41:42,080
Speaker 6: It happened, Mark German, we embrace ourselves. Thank you. Let's

798
00:41:42,120 --> 00:41:44,040
Speaker 6: also just check in on these markets. It is an

799
00:41:44,160 --> 00:41:47,520
Speaker 6: ugly finish to an ugly week, and Nvidia the biggest

800
00:41:47,520 --> 00:41:50,040
Speaker 6: points drag on the benchmarks right now we're seeing off

801
00:41:50,080 --> 00:41:52,160
Speaker 6: by more than five percent. We are now just a

802
00:41:52,239 --> 00:41:55,160
Speaker 6: two and a half trillion dollar company. Folks. Broadcom is

803
00:41:55,200 --> 00:41:57,000
Speaker 6: off by nine percent, and this is the worst day

804
00:41:57,040 --> 00:41:59,520
Speaker 6: for Wallcom since March twenty twenty.

805
00:42:00,160 --> 00:42:03,200
Speaker 5: Socks also ugly, s and P five hundred down the

806
00:42:03,280 --> 00:42:06,680
Speaker 5: most since I think March of twenty three. Na's that

807
00:42:06,800 --> 00:42:11,200
Speaker 5: one hundred worse week since November of twenty two, in

808
00:42:11,320 --> 00:42:14,600
Speaker 5: Vidia having its worst week since September of twenty twenty two.

809
00:42:14,960 --> 00:42:17,400
Speaker 5: The story we're writing about Carr, though, is that you know,

810
00:42:17,600 --> 00:42:20,480
Speaker 5: technology is under pressure in spite of and on top

811
00:42:20,560 --> 00:42:23,320
Speaker 5: of the economic data in the Fed speet we got today.

812
00:42:24,480 --> 00:42:26,400
Speaker 8: Ugly, I think is a fair word to use.

813
00:42:26,960 --> 00:42:29,480
Speaker 6: And put it into context. These are stocks that have

814
00:42:29,600 --> 00:42:32,360
Speaker 6: run up more than a one hundred percent over the

815
00:42:32,400 --> 00:42:34,279
Speaker 6: course of the year to date, so we have to

816
00:42:34,320 --> 00:42:36,360
Speaker 6: acknowledge that. But when you get a four hundred and

817
00:42:36,440 --> 00:42:39,520
Speaker 6: thirty three billion dollar erosion in market cap in five

818
00:42:39,600 --> 00:42:42,640
Speaker 6: days alone, that matters to everyone who has a four

819
00:42:42,680 --> 00:42:45,360
Speaker 6: at one K who is exposed to these sorts of benchmarks.

820
00:42:46,560 --> 00:42:48,320
Speaker 8: Just one quick comment on Nvidia.

821
00:42:48,560 --> 00:42:50,600
Speaker 5: Look at the number of retail investors that have gone

822
00:42:50,640 --> 00:42:52,560
Speaker 5: into that name and then think about that on a

823
00:42:52,640 --> 00:42:53,799
Speaker 5: week or a day like today.

824
00:42:54,000 --> 00:42:57,279
Speaker 6: Incredible and those that are two x leveraged. That does

825
00:42:57,320 --> 00:43:00,239
Speaker 6: it for this edition. Of Bloomberg Technology have.

826
00:43:00,320 --> 00:43:02,480
Speaker 8: To say, what a Friday show. It's been. Recap on

827
00:43:02,520 --> 00:43:02,960
Speaker 8: the podcast.

828
00:43:03,040 --> 00:43:06,000
Speaker 5: You know where to find it, Apple, Spotify, iHeart and

829
00:43:06,040 --> 00:43:08,960
Speaker 5: of course we publish it all over the Bloomberg platforms.

830
00:43:09,000 --> 00:43:11,320
Speaker 5: Thank you to everyone in New York and in San Francisco.

831
00:43:11,440 --> 00:43:13,120
Speaker 5: This is Bloomberg Technology.